Act now on ‘abuse’ by late payers , Ministers urged

THE Government is being urged to take a tougher regulatory stance on big firms squeezing their suppliers after Carlsberg joined the Forum of Private Business’s ‘hall of shame’ last week for extending its payment terms to at least 93 days.

A letter to suppliers, dated July 1, gave them two weeks’ notice of the change, which breaches European Union guidelines that firms should take no longer than 60 days to pay suppliers.

Tracy Ewan, managing director of IGF Invoice Finance, said increasing pressure to remedy ‘this clear abuse of power’ should be ‘enough to push the Government into taking a stronger regulatory stance on the matter’.

She added: ‘It has been six months since the Government proposed a Small Business Commissioner in its Enterprise Bill yet there continues to be no real effort from Ministers to truly address the issue.’

FPB managing director Ian Cass also said: ‘The National Audit Office criticised Government departments in failing to monitor the payment by their initial supplier to their own supply chain. The forum would fully support a Government investigation into this issue.’

Meanwhile, the FPB said it expected more companies to join its hall of shame, which monitors supply chain abuse, within weeks. Last Sunday, we reported on the FPB’s praise of councils for paying invoices promptly throughout the recession.

The FPB has since said that it was wrong to claim that Worcester City Council did not respond to Freedom of Information requests in its latest payments research, as it had sent its request to ‘the wrong people’.

The council has told The Mail on Sunday that it paid 97.2 per cent of invoices within their target of 30 days in 2014/15.